On Appeal from An Order of the United States District Court for the District of New Jersey, Civil No. 84-5356.
Becker and Scirica, Circuit Judges, and Farnan, District Judge*fn*
This is an appeal from an order of the district court granting summary judgment for the Secretary of Health and Human Services ("the Secretary"), thereby affirming the Secretary's denial of Social Security survivor's benefits to Linnette Morales on the ground that she had not established that Herminio Santiago, whose insured status is the source of her potential benefits, was her father. At the threshold this appeal presents a choice of law question: what law furnishes the standard of proof of paternity? One we determine that standard, we must then measure the record against it to decide whether the Secretary's denial of benefits is supported by substantial evidence.
For the reasons that follow, we determine that the applicable law is the New Jersey Parentage Act, N.J.S.A. §§ 9:17-38 to 9:17-59. We conclude that under the standard established by the Parentage Act, the Secretary's decision is not supported by substantial evidence. Because there appears to be no additional evidence that could be developed by another hearing, we reverse and remand with direction to the district court to direct the Secretary to award benefits.
I. FATS AND PROCEDURAL HISTORY
Appellant, Elba Morales, claims that her daughter, Linnette, was improperly denied Social Security survivor benefits following the death of Linnette's putative father, Herminio Santiago. Elba Morales began living with Herminio Santiago in 1973 in Puerto Rico. She gave birth in 1973 to a son, Alexander, whose paternity Santiago acknowledged in writing. The couple later left Puerto Rico with Alexander for Newark, New Jersey, where they continued to live together until March, 1976. At the time Elba and Herminio stopped living together, Elba was approximately six months pregnant, and on June 23, 1976 she gave birth to a daughter, Linnette.
At the time Linnette's birth, Santiago, whom appellant's counsel at an administrative hearing acknowledged was a drug dealer and "somewhat of a fugitive." J.A. at 26, was in Puerto Rico, but, according to appellant, he returned shortly after her birth, bringing a cradle and other gifts for Linnette. Santiago was murdered in Newark, New Jersey, on November 4, 1977. On July 20, 1982, appellant filed an application for Social Security survivor's benefits for her two children, Alexander Santiago and Linnette Morales. On November 17, 1982, the Social Security Administration approved Alexander's application and rejected Linnette's application. Appellant did not seek administrative review of the denial of Linnette's application, but filed a second application on August 3, 1983. The Social Security Administration denied the second application and appellant appealed this denial. A hearing was held before an administrative law judge on February 2, 1984. The ALJ did not articulate the standard for determining paternity, but denied the claim, relying on the lack of written acknowledgment of paternity or of evidence that Santiago was living with or contributing to the support of Linnette at the time of his death. Upon affirmance of the ALJ's decision by the Health and Human Services Appeals Council on October 11, 1984, the denial became a final decision of the Secretary.
Appellant timely appealed the Secretary's final decision to the district court, which affirmed it. Morales v. Heckler, Civ. No. 84-5356, slip op. (D.N.J. Feb. 2, 1987). The district court applied a "clear and convincing" standard of paternity and found substantial evidence to support he Secretary's decision. Id. at 25. It is from the decision of the district court that the present appeal lies.
The Social Security Act provides survivor's benefits for the child of a deceased fully insured wage earner. 42 U.S.C. § 402(d)(1982). Appellant claims that Linnette Morales qualifies as the child of a deceased fully insured wage earner, Herminio Santiago, under Section 216(h)(2)(A) of the Act, now codified at 42 U.S.C. § 416(h)(2)(A)(1982). That section provides, in relevant part, that children will be entitled to survivor's benefits if they can demonstrate that they would inherit personal property from the deceased wage earner under the intestacy laws of the domiciliary state "at the time of his death."*fn1 42 U.S.C. § 416(h)(2)(A)(1982). The parties agree that Herminio Santiago was domiciled in New Jersey at the time of his death, and thus that New Jersey law should be applied. The relevant provisions of New Jersey law have changed substantially, however, and the parties disagree over which New Jersey law should apply - the law in effect at the time of his death or the law that was in force when the claimant's application was filed.
Court that have interpreted & § 416(h)(2)(A) have reached varying conclusion on whether the section is a pure choice of law provision which determines simply that the law of the state of the decedent's domicile at the time of death applies, see, e.g., Owens v. Schweiker, 692 F.2d 80 (9th Cir. 1982); Cox v. Schweiker, 684 F.2d 310 (5th Cir. 1982), or whether the provision also establishes that the law of the state in effect at the time of death also applies, see, e.g., Gonzales v. Harris, 514 F. Supp. 995, 996 (E.D. Cal. 1981); Ramon v. Califano, 493 F. Supp. 158, 159 (W.D. Tex. 1980); Allen v. Califano, 452 F. Supp. 205, 209 (D. Md. 1978). The Court of Appeals for the Ninth circuit in Owens read "at the time of his death" in § 416(h)(2)(A) as simply a choice of law provision that determines which state's law applies, but which does not fix the time at which the law of that state must apply.*fn2
In Adens v. Schweiker, 773 F.2d 545 (3d Cir. 1985), we declined to follow Owens and Cox. In Adens, the putative father died in 1976 domiciled in Pennsylvania. The panel stated that because the wage earner was domiciled in Pennsylvania, it was required to apply the same intestacy law that Pennsylvania courts would use. The Pennsylvania intestacy statute in effect at the time of decedent's death had been found unconstitutional in 1977, because it permitted illegitimate children to inherit from their mothers but not their fathers. The Pennsylvania intestate law that replaced the unconstitutional law allowed inheritance from both parents upon a showing of paternity, but contained a clause that explicitly prohibited retroactive application of the law. 20 Pa. Cons. Stat. Ann. § 2107 (Purdon 1978). The panel held in Adens that "because the Pennsylvania courts make their determinations based on the law existing at the time of ...